BUSINESS

Salesforce and Anthropic announced Tuesday a sweeping expansion of their partnership, called Claudeforce, that pushes the world’s largest customer relationship management platform directly inside Claude — a tacit acknowledgment that the future of enterprise software may not involve enterprise software’s own screens at all.The centerpiece of the announcement is Salesforce in Claude, a plugin for Anthropic’s Claude CoWork that ships with 37 pre-built sales skills — covering meeting preparation, deal health reviews, and pipeline analysis — and lets sellers query, update, and act on live CRM data without ever opening Salesforce itself. The product is available to select pilot customers today, with an open beta planned for September and additional skills for other business functions beginning to launch in the third quarter.Marc Benioff, Salesforce’s chair and CEO, and Dario Amodei, Anthropic’s CEO, were scheduled to appear on television together Tuesday afternoon, hours before Salesforce reports quarterly earnings — a piece of stagecraft that underscores how central this partnership has become to both companies’ narratives.”We’re bringing together the world’s #1 AI and #1 CRM — the best of both worlds,” Benioff said in a statement. “Here, the UI is the AI — allowing you to build custom apps dynamically and answer any enterprise question. Probabilistic intelligence alone doesn’t run a company, and deterministic systems don’t reason.”But the more revealing framing came in an exclusive interview with VentureBeat, where Patrick Stokes, Salesforce’s president of applications and marketing, described the launch in terms that would have been unthinkable for a major SaaS vendor even two years ago.”We think that what this can do is kind of be a version of what Claude Code did for developers,” Stokes said. “We think we’re about to do the same thing for knowledge workers. This is just a whole new way to work.”How Salesforce turned its headless CRM experiment into a one-click Claude pluginThe road to Claudeforce began in March, when Salesforce released Headless 360 at its TDX developer conference — a collection of APIs, MCP servers, and command-line tools that let AI agents call Salesforce data, workflows, and governance rules directly, with no user interface required.”I think we really kind of surprised the world a little bit with our Headless approach,” Stokes told VentureBeat, “basically kind of openly suggesting that these agentic interfaces are a really good way to use Salesforce’s products, and we don’t actually mind if you don’t use Salesforce’s products exclusively through a user interface designed for a human.”What happened next, according to Stokes, was both validating and messy. Customers rushed to wire Salesforce’s MCP servers into agentic interfaces — “but really, Claude rose to the top,” he said. The problem was friction. “Every individual user has to know what an MCP server is. Obviously, your average knowledge worker out there is not dealing in MCP servers every day. And you know, even if you can find it, how do you wire it up? And then, how do you make sure that it’s respecting the permissions of the users?”The answer came from an unexpected source: Anthropic’s own workforce. “We sat down with Anthropic and we talked about the problem, and they said, ‘Hey, this is actually how we’re using Salesforce. We use Salesforce pretty much exclusively through Claude and a series of skills and MCP servers that we have,'” Stokes recounted. The two companies decided to productize that internal setup as a CoWork plugin — one that an administrator connects a single time, with authentication and permissions managed centrally, so “all of the difficulty of wiring up every individual user with an MCP server is just magically solved.”Under the hood, the architecture is deliberately simple. When a seller asks Claude to update a deal, Claude first reasons over its available skills — “kind of human-like instructions,” as Stokes described them — to determine whether specific guidance exists for the task. If it finds a match, it reads the instructions and executes against Salesforce’s MCP server, which inherits the user’s existing permissions. “If you don’t own that record, if you don’t have permission to see that record, the MCP server doesn’t either, and so you won’t be able to read or write it,” he said. For enterprise buyers, that may be the announcement’s most important technical claim: nothing new to stand up, nothing to re-audit, nothing to configure account by account.Why Salesforce says letting sellers live in Claude makes its platform more valuable, not lessThe strategic tension at the heart of Claudeforce is obvious: if sellers start living in Claude instead of Salesforce, doesn’t Salesforce become less important over time?Stokes rejected the premise emphatically. “That’s not what we’re seeing at all,” he said. “The value of Salesforce is not in our UI itself. It’s not the application. The value of Salesforce is in the data and the metadata, the years worth of kind of encoded workflows and business practices that have been built up inside of Salesforce. What we’re doing is we’re taking that and we’re exposing it to a new UI.”He offered a concrete example of the productivity math Salesforce is betting on. A seller’s morning ritual — deciding which opportunities to work — traditionally means opening an opportunities list, clicking into each record, reading activities and meeting histories, and synthesizing everything mentally. “That process of evaluating all of those records and synthesizing it and coming up with a plan is like 10,000 clicks inside of Salesforce,” Stokes said. “Now you just go to Claude and it’s going to execute all of that for you, and it’s going to do it in like 30 seconds.”The paradoxical result, he argued: “I’m actually using Salesforce more than I ever would have before, because the work of clicking around to get what I need is gone.”There is self-interest in that framing. Salesforce charges for this new usage through its headless consumption pricing — “depending on your edition of your user license within Salesforce, you effectively get more incremental access to more and more API calls,” Stokes explained. Customers separately contract with Anthropic for the Claude inference itself. “You can’t buy this on one piece of paper at the moment,” he acknowledged. That two-invoice structure hints at the deeper industry shift underway: the slow migration of enterprise software economics from seats to consumption. If agents rather than humans become the primary consumers of SaaS functionality, per-user licensing loses coherence — and Salesforce appears to be positioning API consumption as the successor metric before someone else forces the issue.What Claudeforce means for Agentforce and the deepening Salesforce-Anthropic allianceThe announcement also raises questions about Agentforce, the agent platform Salesforce has spent roughly two years promoting as its AI centerpiece. Stokes drew a careful taxonomy to distinguish the two.”These are not apples that you can look at as equivalent things,” he said. “Agentforce is really designed for autonomous work or work that touches the end customer. So think about help.salesforce.com — that is an agent implementation specifically designed to interface with the end customer.” Salesforce in Claude, by contrast, “is a knowledge worker agent… specifically designed for sellers, for salespeople, to help them do their day-to-day job without having to do the traditional part of their job, which is click around in user interfaces and try to synthesize data themselves.”The distinction is tidy, but it papers over a real strategic evolution. In October 2025, Reuters and CNBC reported that Salesforce was hedging its model bets, bringing both OpenAI and Anthropic into Agentforce and even putting Agentforce inside ChatGPT.Since then, the relationship with Anthropic has clearly deepened into something closer to a preferred alliance: Bloomberg reported in June that Salesforce’s investment in Anthropic was valued at roughly $5 billion, and Tuesday’s release makes Claude the default model across Slack — powering Slackbot, the Claude Tag feature Anthropic previewed in June, and the new Slack Code product. Salesforce says 83% of its workforce now uses Claude-powered Slackbot, saving what it claims is 3.8 million productivity hours annually.For Anthropic, which The Wall Street Journal has reported is bulking up its enterprise partner program amid IPO preparations, the deal delivers something invaluable: distribution into the daily workflow of millions of sellers at companies that already trust Salesforce with their most sensitive commercial data. It also delivers tokens. “Once you start using this, you get very excited and you start to see how it can improve your day,” Stokes said. “And yes, that is going to drive token consumption, which is obviously part of the reason why Anthropic is excited about this as well.”Inside the demo: AI-generated dashboards and the rise of the vibe-coded CRMThe most striking moment of VentureBeat’s briefing came during a live demo from Shannon Mathews, Salesforce’s VP of product management, who showed a seller asking Claude to “schedule a daily briefing to tell me where should I focus my business.”The system returned a prioritized action plan — flagging, for instance, that six closing opportunities had no next steps (“I’m sure my leadership is not going to be thrilled about that,” Mathews joked) and surfacing a COO change at a key account pulled from the web. “It really provides a concise call to action of where I should be focusing my time for today and this week,” she said, describing the vision as giving every rep “almost an AI chief revenue officer.”Then came the part that gestures at something genuinely new. Mathews generated a full sales dashboard — a “command center” — that Claude coded on the fly as a local HTML file, styled, at Stokes’s request, “like Miami Vice, like Tron, just because I thought it was cool.””This isn’t like a product that we’re shipping,” Stokes said. “This is Claude coding this on the fly using Salesforce data… If you think about all these different tools that we have to use — Salesforce, Workday, or whatever — we always have to use the UI that somebody else decides you’re going to use. Now we’re just taking Salesforce data and workflows, and CoWork is giving you the ability to make the UI look like whatever you want.”Asked directly whether users can effectively vibe code their own dashboards, complete with actions and tool calls, Stokes leaned in. “This idea that people are going to vibe code their own CRM is probably not going to happen anytime soon. But what we are seeing is that people do want to vibe code their own CRM, and that’s what we’ve enabled. We’ve just said: do it with Salesforce… You’re vibe coding against trusted, governed Salesforce data.” At a recent internal leadership summit in Hawaii, he said, “every single one” of the sales executives presenting business reviews “showed up with a command center-like view of their business that they built themselves right inside of CoWork.”The bigger bet: why Salesforce is embracing its own disintermediationStrip away the branding and Claudeforce amounts to a wager that Salesforce is better off embracing its own potential disintermediation than resisting it. The history of platform shifts suggests that incumbents who fight new interfaces — rather than racing to own their position within them — tend to lose. Salesforce is betting that its moat was never its Lightning pages; it was 27 years of accumulated data, metadata, workflow logic, and governance that no model can conjure and no startup can quickly replicate. As the companies’ own launch materials put it, a frontier model without that context is “a genius who’s never seen your deals.”The bet carries real risks. If the interface layer commoditizes, pricing power could migrate toward whoever owns the intelligence — and Anthropic, not Salesforce, owns Claude. The consumption-pricing transition could cannibalize seat revenue faster than API calls replace it. And the broader market remains skittish about exactly this scenario: Reuters reported in February that U.S. software stocks staged a relief rally on an Anthropic announcement, a reminder of how much SaaS valuations now hinge on whether AI labs are perceived as partners or predators. There is also the unglamorous question of whether enterprises will capture the promised value at all. Gartner forecast worldwide end-user spending on generative AI models at $14.2 billion for 2025, yet McKinsey’s ongoing State of AI research has repeatedly found that while adoption is nearly universal, most organizations still struggle to translate pilots into measurable bottom-line impact. Claudeforce’s answer — pre-built skills, inherited permissions, one-time setup — is essentially an argument that the ROI gap has been a deployment-friction problem all along.Stokes framed the moment in almost epochal terms. “Salesforce believes that the interface to SaaS is undergoing a pretty significant period of change, and in some cases aggregation,” he said. “We’ve already seen that AI has changed the way people build software with coding agents, but now we’re seeing that it’s fundamentally changing the way that people use software — and that can feel very scary on the surface. But our experience is that they’re using software way more than they were, because this is unlocking trapped value that is trapped behind a human’s own ability to click around and synthesize information themselves.”Whether that proves prophetic or self-serving will play out over the coming quarters, as the beta opens in September and the skills expand beyond sales into service, marketing, and commerce. But the symbolism of Tuesday’s announcement is already unmistakable. Salesforce spent 27 years building the defining user interface of enterprise software — and then spent Tuesday morning telling the world its customers no longer need it. The company that taught business how to click is now betting everything on the idea that nobody wants to.

The United States Space Force introduced a new dress uniform while the U.S. Air Force unveiled a special football uniform inspired by the B-21 Raider bomber.

Chains including Marshalls, TJMaxx, and Costco have made the treasure hunt a key part of their business model. Merchandise changes regularly, so you never know what you might find, and the prices generally beat traditional retail.

That’s supposed to drive repeat visits from shoppers looking for a deal.

“These stores represent a kind of treasure hunt for consumers,” Jaime Ward, the former head of the Retail Finance Group for Citizens Bank, told REjournals. “They don’t know exactly what they want. They know they need something. They go in and find top brands at deeply discounted prices. It feels like a total bargain and a rare find. That is a shopping thrill that consumers like.”

JCPenney thinks that at least some consumers who want value also want to know that the items they’re looking for will be in stock when they visit a store. That has led to the company’s new ad campaign, which takes on retailers including Costco, Marshalls, TJMaxx, Ross Dress for Less, and others that use the treasure hunt model.

JCPenney tries to take down treasure-hunt retailers

JCPenney has a new advertising campaign that’s trying to position the brand as an alternative to treasure-hunt chains such as Costco, Sam’s Club, Marshalls, and TJMaxx.

The chain calls the program “Retail Rejuvenation” and explained the premise in a press release.

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“You walk into a store, hopes high, only to walk out disappointed. You saw a shirt you loved, but couldn’t find it in your size. Or worse, you settle and buy something that didn’t quite fit to avoid leaving empty-handed,” the retailer shared.

“Trust us, we’ve all been there. But we’re letting you in on a secret — you don’t need to settle to get the best deal. That’s why JCPenney is inviting you to discover a better way to shop.”

It’s an effort to convince people that they can still get good deals without having to submit to the uncertainty of a treasure hunt.

JCPenney wants shoppers to know that it has what they’re actually shopping for.Shutterstock

Consumers, however, like the treasure hunt

As a shopper who has covered the retail industry for over 30 years, I’m mixed on the treasure hunt. I like when I’m shopping at Costco and find a book, some candy, or even some clothing I wasn’t looking for.

I will never shop at a Marshalls, TJMaxx, or similar store when I actually need something, however. Many people don’t agree with me, but I shop for clothes when I’m looking for something specific, not hoping to find a bargain on something I may not need.

Former Ross Stores CEO Barbara Rentler explained why the treasure hunt model works during a 2024 earnings call.

“It’s really about the value you’re putting on the floor, the products and the value, it always comes back to the product and the value. And then it will turn quickly because the customer knows in a treasure hunt environment, if I don’t buy it, it won’t be there next week,” she said.

The treasure hunt model also offers flexibility to the retailers operating it.

When brands produce too many clothes or department stores cancel orders, the discount treasure hunt chains step in and buy the leftover inventory.

“Ross calls them ‘opportunistic purchases.’ It can either quickly ship the product to shelves to meet in-season looks or pack the products away in warehouses to sell later. Both methods help the company constantly rotate through a wide assortment of styles and fashions,” CBS News reported.

JCPenney is going on offense

RTM Nexus CEO Dominick Miserandino applauds JCPenney for trying to give itself an identity that makes it stand out to shoppers.

“Look, calling out the elephant in the room works because younger consumers hate corporate fluff. Wendy’s proved a decade ago that shoppers reward brands that speak plain English and call out the competition directly,” he told TheStreet.

The struggling department store, he noted, is trying to differentiate its shopping experience from its rivals that use the treasure-hunt model.

“JCPenney taking aim at Marshalls and Costco isn’t just a marketing stunt — it’s an attempt to cut through the noise by stating a blunt truth every discount shopper knows: Digging through messy clearance racks or standing in a hundred-person line at a warehouse club can be an exhausting headache,” he added.

The company is being bold, he explained, and that’s a positive for the brand.

“In retail today, being polite gets you ignored. Gen Z and Millennial shoppers appreciate a brand that drops the formal PR speak and calls out the trade-offs of competitor models directly. If JCPenney can back up the talk with clean stores and inventory that’s actually in stock, calling out the competition’s flaws directly is the exact play to get people’s attention,” he wrote.

ALSO READ: Popular discount mattress chain files for Chapter 11 bankruptcy

Salesforce cleared Wall Street’s second-quarter expectations and deepened its ties with AI lab Anthropic.

A major sportswear retailer is reshaping its store footprint as it integrates a recently acquired business, and the results suggest the strategy is coming at a much higher price than the company and investors expected.

The retailer has been closing locations, reviewing underperforming assets, and taking hundreds of millions of dollars in related charges. Now, a sharp earnings miss and a lowered outlook have sent its stock tumbling in one of the most dramatic trading sessions in its history.

Founded in 1948, Dick’s Sporting Goods is one of the largest sports-goods retailers in the U.S., selling sports equipment, clothing, and footwear through a portfolio of brands and retail concepts.

The company operates under multiple banners, including Dick’s Sporting Goods, Golf Galaxy, Public Lands, Going Going Gone!, Dick’s House of Sport, Golf Galaxy Performance Center, Foot Locker, Kids Foot Locker, Champs Sports, WSS, and atmos. It also operates GameChanger, a sports technology platform.

Dick’s Sporting Goods closes 113 stores in 2026

Dick’s Sporting Goods (DKS) has closed 113 stores across its portfolio during fiscal 2026 through the second quarter, according to the company’s second-quarter earnings release.

The closures include three locations within the broader Dick’s business and 110 locations within the Foot Locker business.

The company also opened stores during the period. Within its Dick’s business, it opened four new locations, while the Foot Locker business opened 27 stores.

As of Aug. 1, 2026, Dick’s Sporting Goods operated 3,104 store locations across its Dick’s and Foot Locker businesses.

The store closures were concentrated heavily within the Foot Locker business, reflecting the company’s effort to reposition the portfolio following its acquisition of the footwear retailer.

Why Dick’s Sporting Goods is closing stores

Dick’s Sporting Goods acquired Foot Locker in September 2025 in a $2.5 billion transaction. The deal brought Foot Locker’s global footwear and apparel business into Dick’s Sporting Goods’ portfolio and expanded the company’s international retail presence.

Following the acquisition, Dick’s Sporting Goods began reviewing what it calls “unproductive assets.” The review includes optimizing inventory, closing underperforming stores, and right-sizing assets that do not fit the company’s long-term strategy for the Foot Locker business.

Of the Foot Locker business’s fiscal 2026 closures, 67 stores were identified as part of that review of unproductive assets. The company also relocated or remodeled 41 stores during the year as it works to reposition its store portfolio.

The restructuring has come with substantial costs.

Dick’s Sporting Goods incurred $125.8 million in pre-tax charges during the 26 weeks ended Aug. 1, 2026, bringing total charges related to the effort to $515.8 million to date. The company expects total pre-tax charges of up to $750 million, including approximately $200 million in fiscal 2026, with the remainder expected over the medium term.

Dick’s Sporting Goods closes 113 stores in 2026.Bloomberg / Getty Images

Dick’s Sporting Goods reports weaker-than-expected results

The store changes come as the retailer confronts a more difficult environment for athletic footwear and apparel.

During the second quarter of fiscal 2026, Dick’s Sporting Goods reported:

Net sales: Increased 53.2% year over year to $5.59 billion

Net income: Declined 17.3%

Dick’s comparable sales: Climbed 4.9%

Foot Locker comparable sales: Fell 3.6%

Earnings per diluted share: $3.53 adjusted, below the $3.76 expected

The sharp increase in consolidated sales was largely driven by the inclusion of Foot Locker following the acquisition. At the same time, the Foot Locker business continued to struggle, with comparable sales declining 3.6% during the quarter.

The weaker-than-expected performance prompted Dick’s Sporting Goods to lower its full-year outlook.

The company now expects adjusted diluted earnings per share of $10.94 to $11.94 for fiscal 2026, down from the previous forecast of $13.50 to $14.50. It also lowered its full-year net sales outlook to $21.9 billion to $22.2 billion, compared with its previous range of $22.1 billion to $22.4 billion.

Dick’s Sporting Goods stock suffers record decline

Investors responded sharply to the weaker results and reduced outlook.

Shares of Dick’s Sporting Goods fell more than 30% on Aug. 25, marking the company’s worst single-day stock decline on record, according to CNBC. The sell-off followed the earnings release and guidance reduction, rather than being directly attributed to the store closures alone.

The Foot Locker results also highlighted ongoing challenges in the recently acquired business, as Dick’s Sporting Goods said certain legacy footwear silhouettes and apparel franchises are no longer resonating with consumers like they once did.

The company also said that elevated inventory levels across the industry and the broader retail marketplace have contributed to a more promotional environment. Dick’s Sporting Goods said it believes maintaining competitive pricing is important to protect its market position.

What this means for Dick’s Sporting Goods

Dick’s Sporting Goods said its core Dick’s business will continue focusing on store growth, relocations, improvements to its existing locations, technology, and supply-chain investments.

For the Foot Locker business, the company plans to continue investing in its store fleet through its Fast Break initiative while supporting the business’s long-term turnaround.

Here’s some of my previous coverage of store closures:

Sportswear giant continues store closures nationwide

Sportswear giant ends 10-year partnership amid store closures

Global sportswear brand closing 15 stores, laying off workers

The company acknowledged that the retail environment remains challenging and expects a more promotional environment through the remainder of fiscal 2026.

“While those dynamics are creating near-term challenges, our confidence in the Dick’s business and the long-term opportunity at Foot Locker remains unchanged,” Dick’s Sporting Goods CFO Navdeep Gupta said during the company’s earnings call.

For now, the retailer is pursuing two very different strategies within its portfolio: continuing to expand and improve its core Dick’s business while closing, remodeling, and repositioning parts of the newly acquired Foot Locker business.

That strategy is designed to create a stronger store portfolio over time, but the latest earnings report shows investors are increasingly focused on how long that turnaround will take and how much it will cost along the way.

Related: Sportswear giant continues store closures nationwide

Salesforce has spent the last few quarters trying to send a clear message to investors: It’s not like the other software companies and won’t be left in the dust by new artificial intelligence tools. Its quarterly results, due out after the closing bell on Aug. 26, 2026, will be the latest indicator of whether or not that’s true.

Analysts polled by LSEG are looking for these big numbers:

Revenue: $11.32 billion

Earnings per share: $3.27

This page will refresh periodically with updates as they cross the wire, including the company’s results and its forecast and commentary to follow.

Every valuation is a story that someone agreed to believe.

In private markets, that story gets told in a conference room, signed by a handful of investors, and then repeated for years as if it were a fact.

Nobody has to test it. There is no daily quote, no crowd of skeptics pricing the risk in real time, and no moment when the number has to survive contact with strangers.

That arrangement works fine until the company needs public money.

Then the story stops being a story. It becomes a price, and the price gets set by people who were not in the room when the promise was made. Some companies survive that translation with their dignity intact. Plenty do not.

The space between what a business is said to be worth and what buyers will actually pay is where the useful information lives. This week, one of the widest gaps in modern retail finally landed on a stock exchange filing.

Shein, the ultra-fast-fashion retailer known for $5 dresses and $10 jeans, launched its Hong Kong global offering on Monday, Aug. 24, at a valuation of roughly $27 billion.

Four years ago, investors said it was worth $98.2 billion.

What the Shein IPO price actually admits

Shein is selling about 280 million Class B shares priced between HK$47.60 and HK$49.50, raising as much as HK$13.86 billion, or about $1.77 billion, according to CNBC.

The final price arrives Aug. 31, with trading set to begin Sept. 1 under the stock code 00625.

That top-end number values the company at close to $27 billion, down roughly 70% from its private peak.

Related: Shein’s latest buy blurs the line between ethics and fast fashion

The retreat happened fast. Shein opened investor meetings this month seeking $30 billion to $40 billion and ended up well below the floor of its own ask.

Here is the ladder, and it is worth reading slowly:

The company was valued at $98.2 billion in a 2022 private round, according to Reuters.

Investors marked it at $64 billion in 2023 and again in April 2024, CNBC noted.

Bankers opened this month’s meetings targeting $30 billion to $40 billion, Reuters reported.

The offering launched at close to $27 billion at the top of the range, according to the prospectus filed with the Hong Kong exchange.

“The company has missed the golden time to list,” William Ma, chief investment officer at GROW Investment Group, told CNBC.

Shein prices its Hong Kong IPO at about $27 billion, roughly 70% below its 2022 private mark.Mike Kemp / Getty Images

Why Shein owes $3.5 billion to its earlier backers

Here is the part that got buried under the valuation headlines, and it is the part I would read first.

Shein has agreed to hand as much as $3.5 billion in cash and shares to a select group of existing investors, a sum “almost twice the fresh capital it is seeking in an IPO,” reported The Standard HK.

The mechanism is called a conversion adjustment, and it is standard equipment in late-stage private rounds. Holders of Shein’s Series pre-D, Series D, and Series D plus preferred shares negotiated protection against exactly this outcome, a listing below the price they paid.

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Those investors bought in at valuations of about $60.5 billion, $98.2 billion, and $64 billion, respectively. The IPO prices the company at less than half the cheapest of those marks.

So the protections triggered. Shein could pay up to $2.2 billion in cash if the deal prices at the bottom of the range, issue 19.6 million bonus shares at no cost, and separately make about $1.33 billion in additional payments to the same group, according to The Standard HK.

The money comes out of the company’s own balance sheet, not the IPO proceeds.

I ran those two figures side by side, and the arithmetic is blunt. Shein raises $1.77 billion from the public and owes up to $3.5 billion to the private investors who got there first. Boyu Capital, Tiger Global, General Atlantic, Thrive Capital, Mubadala, and Brookfield are among the names entitled to the payments.

Older Series A, B, and C holders get nothing from this arrangement.

How the tariff shift turned Shein’s profit into a loss

The valuation reset is not a mood. It tracks a real deterioration in the numbers.

Revenue reached $41.8 billion in 2025, up about 8%, while net profit fell 38.7% to $2.06 billion, reported WWD. Growth had run at 20.7% the prior year.

Then the first quarter of 2026 arrived. Shein swung to a net loss of $99 million against a $395 million profit a year earlier, and operating income dropped 26% to $258 million, reported the Japan Times.

The cause is sitting in the customs data. Washington killed the de minimis exemption in May 2025, ending duty-free treatment for parcels under $800, which was the structural advantage that made $5 dresses possible at scale.

Removing it has had “an adverse impact on our sales in the U.S.,” Shein said in the prospectus, according to Yahoo Finance.

U.S. revenue fell 14.3% to $2.04 billion in the quarter.

Europe is next in line. The European Union on July 1 imposed a 3-euro charge on low-value shipments, and Europe accounted for close to a third of 2025 revenue. Shein warned the effect could match or exceed what happened in America.

This is the same tariff math that has been pushing prices up at major U.S. retailers all year, except Shein built its entire model on the exemption that disappeared.

What the Shein listing tells you about private valuations

Most American readers will never buy this stock. It lists in Hong Kong, and the Class B shares carry one tenth the voting power of founder shares, leaving the four co-founders with 90% of the vote.

The useful part is the pattern, and my analysis of the payout structure is what makes it legible.

Private markets have been running on marks that nobody had to defend. Pension funds, endowments, and sovereign wealth vehicles hold those marks in their books, and increasingly, so do the private credit and private equity sleeves showing up in ordinary retirement accounts.

Shein is the rare case where the reckoning happens in public, on a specific date, with a specific number attached.

When it does, the order of payment matters more than the valuation. The investors with contractual protection get made whole first, out of company cash, before a single public shareholder collects anything.

Watch for that clause the next time a famous private company finally lists. The headline will be the valuation cut. The story will be who negotiated a floor and who did not.

Shein prices Aug. 31. The $5-dress era is being repriced with it.

Related: Beloved fashion brand makes surprising Shein move

Alphabet (GOOG) stock entered 2026 with a remarkably tough act to follow.

Its stock soared nearly 66% in 2025, according to Yahoo Finance, with investors buying into its bull case, backed by Google’s growing AI position, robust cloud business, and resilient Search franchise.

It’s still up more than 10% this year, based on Seeking Alpha data, but has lost 9% of its value over the past three months as investor concerns over spending and returns have collided. 

Now, though, Morgan Stanley analysts argue that investors might be overlooking a far bigger AI opportunity taking shape inside Alphabet.

Nevertheless, a lot of the concerns this year resurfaced in Alphabet’s Q2 results.

Revenue surged 24% to $119.8 billion, and Google Cloud shot up 82% to $24.8 billion, underscoring tremendous demand for AI infrastructure and services.

Still, Alphabet bumped its 2026 capex forecast to as high as $205 billion, intensifying Wall Street’s already elevated concerns over AI spending and monetization, as I covered in July.

That said, in a note shared with me, Morgan Stanley now sees a far bigger answer emerging. 

The firm is doubling down on Alphabet stock, leaning harder into the bull case, with investors remarkably underestimating a growing piece of the company’s AI business, a shift that could become hugely important for its valuation through 2028.

Google’s TPU opportunity is getting much bigger

Morgan Stanley is sticking with its Overweight rating and $400 price target on Alphabet, implying nearly 15% upside from the stock’s Aug. 21 close of $344.82. 

At the heart of the bank’s latest note, though, is a sharp reset to how much sales Google could generate by selling its proprietary Tensor Processing Unit, or TPU, systems to customers.

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Morgan Stanley estimates Alphabet could monetize first-party TPU sales at nearly $27 billion per gigawatt, up from the previous $20 billion estimate, assuming a 30% gross margin versus 20% previously. 

The eye-catching revision follows reports that Google could potentially supply about 1 million TPUs, representing 1.3 GW of capacity, for around $35 billion. Alphabet’s expanded custom-silicon relationship with Marvell Technologies (MRVL) also supports the bank’s view that TPU pricing is running hotter than previously assumed.

As a result of that change, you now have some enormous figures. 

Morgan Stanley expects Google to sell 0.3 GW of TPU systems in the second half of 2026, 3.2 GW in 2027, and 4.2 GW in 2028. That translates into $84 billion of TPU-related Google Cloud sales in 2027 and $108 billion in 2028, increases of 35% and 37% from previous forecasts.

The TPU ramp-up changes the scale of Cloud. Morgan Stanley bumped its total Google Cloud sales forecasts by 6% for 2027 and 7% for 2028 while raising Cloud EBIT estimates by 2% in both years.

Also read: Alphabet’s stock buybacks: History & investor impact explained

More importantly, the bank now expects Google Cloud to generate 48% of Alphabet-wide EBIT by 2028. That would turn Cloud into perhaps Alphabet’s most dominant profit contributor.

Currently, Google Cloud is generating nearly one-fifth of Alphabet’s total sales. In Q2, Cloud revenue was at $24.8 billion, or 21% of Alphabet’s $119.8 billion total sales, as reported by Seeking Alpha. 

However, there is a big trade-off to consider.

TPU hardware carries lower margins than Google’s core cloud services, compelling Morgan Stanley to lower its cloud margin estimates to 37% in 2027 and 40% in 2028.

Still, the bank expects core cloud incremental margins to hover around an impressive 50%, suggesting the underlying business remains tremendously profitable, even as TPU sales scale.

Morgan Stanley sees Google’s TPU business becoming a major Alphabet growth engine.Benjamin Fanjoy/Getty Images

Gemini 4 could be Alphabet’s bigger catalyst

Apart from Google’s massive TPU opportunity, Morgan Stanley sees Gemini 4 as another major catalyst for Alphabet stock. 

The bank expects the model to be released in late 2026 or early 2027 and says that returning Google to, or near, the AI frontier could restore investor confidence in its competitive positioning.

It comes at an opportune time.

Google’s flagship Gemini 3.5 Pro was delayed after reportedly falling short of internal performance goals, primarily in coding, while rivals OpenAI and Anthropic continued to push ahead. CEO Sundar Pichai has since hailed Gemini 4 as a substantially larger frontier model, signaling a faster release cadence.

“We’re really focused, putting a lot of effort into Gemini 4,” Pichai said on Alphabet’s Q2 call. “It’s a very ambitious effort.”

In addition, Morgan Stanley highlights Google’s Flash models, prioritizing speed and cost efficiency. That could become increasingly pertinent as enterprises move from AI experimentation to large-scale deployment, where inference costs matter much more.

And there’s plenty of evidence that Google can compete on this front. 

Independent testing by Artificial Analysis ranked Gemini 3.7 Flash among the leading models for intelligence, producing nearly 362 output tokens per second, with an input price of $0.75 per million tokens.

At the same time, scale isn’t theoretical anymore. Gemini now has nearly 950 million monthly active users, putting it within striking distance of ChatGPT, according to Reuters.

Google’s big test with Gemini is productization.

The tech giant gains immensely from deploying the service broadly across Search, YouTube, and Google’s other products in ways that produce durable sales growth.

Related: Bank of America raises price targets on 10 software stocks

What should Alphabet investors do now?

For Alphabet investors, the setup has everything to do with execution rather than proving AI demand exists. 

Morgan Stanley’s lofty target implies a superb 15% upside, but getting there will require investors to award a healthier premium as Cloud, TPUs, and Gemini become bigger earnings drivers.

The target assumes 24 times average 2027-2028 earnings, compared to Alphabet’s much smaller growth-adjusted premium today.

Morgan Stanley’s own model values Alphabet at 22 times 2028 earnings at $400, compared to around 19 times at recent prices. That means some of the upside requires multiple expansions, not just higher earnings.

From a broader perspective, investors have recently favored the big hyperscalers, including Microsoft (MSFT) and Amazon (AMZN), since their sheer scale, customer relationships, and control over infrastructure offer far more durable advantages than those of highly leveraged AI specialists. 

However, the shift toward capital-intensive AI businesses might restrain their valuation multiples, even if earnings remain robust.

Nevertheless, spending remains the pressure point. Alphabet, Amazon, Meta Platforms (META), Microsoft, and Oracle (ORCL) are expected to spend $750 billion on data centers in 2026, according to BigGo Finance, raising the bar for AI monetization and free cash flow growth.

For existing Alphabet stockholders, though, that argues for holding through, despite the spending-driven volatility, instead of treating every capex scare as thesis-breaking. For newer investors, it might be wise to build positions gradually instead of chasing every rally. 

The checkpoints are pretty obvious.

Investors need to monitor TPU sales, cloud margins, and backlog, as well as Gemini’s competitive performance and free cash flows. It’s important to note, though, that the downside is real.

Morgan Stanley’s bear case has Google stock dropping to $225 if advertising slows down, AI pressures margins, and spending discipline deteriorates. 

Alphabet, therefore, will continue to look attractive if AI spending consistently produces top- and bottom-line growth. If monetization fails to keep up with capex, the same spending fueling the bull case will become the stock’s biggest constraint.

More on Alphabet & its stock: 

History of Alphabet: Company timeline, milestones & facts

Alphabet’s dividend history, yield & future prospects explained

Alphabet’s stock splits: History & prospects explained

It’s still possible a future court ruling could block the policy.

Wall Street has spent much of 2026 debating whether AMD is an Nvidia alternative or a genuinely different bet. On Aug. 25, one of the Street’s higher-ranked chip analysts made his position clear.

AMD shares jumped roughly 4% on the day. The upgrade came with a specific argument about where server chip revenue is headed that goes well beyond the usual AI trade.

Raymond James upgrades AMD to Strong Buy, raises price target

Simon Leopold, Raymond James’ semiconductor analyst, upgraded AMD to Strong Buy from Outperform and raised his price target to $641 from $565 on Aug. 25, implying roughly 40% upside from AMD’s closing price that day, CNBC reported.

Leopold ranks 120th out of 12,496 analysts tracked by TipRanks, with a 60% success rate and an average return of 30% per rating. His $641 target sits above the consensus average of roughly $613 across all analysts covering AMD.

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“AMD offers the strongest combination of direct earnings leverage, datacenter positioning, and market-share gains,” Leopold wrote in his note. Then he added a sentence that landed harder than the price target itself: “AMD’s growth should enable it to overtake Intel during 2027.”

AMD is up roughly 113% year to date heading into the upgrade. The stock had already been one of the better-performing semiconductor names in 2026 before the Aug. 25 move.

AMD server CPU revenue forecasted to hit estimated $201 billion or more by 2030

The center of Leopold’s argument is not AMD’s AI accelerator business. It is server CPUs, a part of the market that tends to get less attention than graphics chips but which he thinks is about to get much more profitable for AMD.

Raymond James forecasts server CPU revenue growing at a 44% compound annual rate to roughly $201 billion by 2030. Leopold’s own forecast is slightly below AMD’s internal estimate of $220 billion. He noted that his number could close that gap if agentic AI is adopted faster than he currently models, according to Benzinga.

The logic is straightforward. AI factories need accelerators to train and run models. But those accelerators still need powerful CPUs to coordinate tasks and manage data.

As enterprises deploy more agentic systems, those multi-step workflows need even more CPU coordination. That is where AMD’s EPYC processors come in.

BMO Capital recently said AMD is on the “verge of becoming a complete AI infrastructure provider,” citing the Helios AI rack as a product that could help it gain share against Nvidia, as StockTwits reported.

Microsoft will deploy Helios across Azure AI services beginning in the second half of 2026. Anthropic has also signed a major deal with AMD that significantly expands the chipmaker’s push into AI infrastructure.

At current prices AMD trades at roughly 41 times projected earnings.Caroline/Getty Images

AMD data center revenue up, EPYC gains market share against rival Intel Xeon

The upgrade also rests on AMD’s recent execution. Data center revenue surged in the second quarter to $6.7 billion, up 107% year over year. That accounted for more than half of AMD’s total quarterly revenue of $11.54 billion, which itself rose 50% year over year.

AMD’s server CPU market share has been moving in one direction. Its overall x86 processor shipment share reached 30.7% in the second quarter, while Intel’s fell to 69.3%.

AMD’s server-specific share rose to 34.5%, up 7.3 percentage points from a year earlier. Intel’s server share fell to 65.5%, according to Tom’s Hardware.

Related: AMD’s stock split history (& prospects) explained

When comparing EPYC against Intel’s Xeon directly, AMD’s server share rises as high as 46.4%, Mercury Research President Dean McCarron noted, according to Tom’s Hardware.

Intel is still the larger supplier. But every percentage point AMD takes is revenue that did not exist in AMD’s model a year ago.

AMD stock risks valuation and what investors should watch in 2026

Leopold’s bull case has a long list of moving parts. SpaceX chose Nvidia exclusively for its orbital AI infrastructure. Custom silicon from Microsoft and Google keeps getting better. Intel is not standing still.

And agentic AI, the part of the thesis that pushes the server CPU market to $201 billion, could roll out slower than anyone’s model assumes right now.

At current prices, AMD trades at roughly 41 times projected earnings. Getting to $641 means crossing a trillion-dollar market cap. That requires earnings growth to outrun revenue growth for years.

Leopold thinks that will happen. The next few earnings reports will say whether he is right.

The three numbers worth tracking are data center revenue, EPYC server processor revenue, and gross margins. Data center revenue is where AMD has been winning, but the pace needs to hold.

EPYC is the specific product driving Intel share losses. Any sign the gap is narrowing would put the 2027 overtake prediction in question. Gross margins will show whether AMD is growing profitably or buying share at the expense of earnings quality.

Nvidia reports on Aug. 26. Any commentary from Jensen Huang on AI infrastructure demand or server CPU competition will land directly on Leopold’s thesis.

A strong Nvidia quarter reinforces the bull case for the whole sector. A cautious outlook does the opposite.

Related: 5-star analyst resets AMD stock price target